The Hindu Business Line : ActionAid flays HLL over tea workers' woes

ACTIONAID, which describes itself as "an international development agency" whose aim is to fight poverty worldwide, has released a report `Tea Break' which flays Hindustan Lever, a subsidiary of Unilever, for reaping large profits even as it neglects to take sufficient responsibility "to safeguard the rights and livelihood of the millions of tea growers and workers who contribute to its profits."

According to the report, the tea industry in the country accounts for 31 per cent of global tea production. It is the second largest employer in the country, giving employment to more than 1.2 million workers on a permanent basis, in addition to one million labourers on a casual basis.

An estimated 10 million people in the country depend on the tea industry for their livelihood and 51 per cent of the workforce comprises women. The majority of women are employed to pluck tea - the most labour-intensive part of tea production.

ActionAid, with Indian civil society groups, conducted interviews with workers on the Davershola tea plantation owned by Hindustan Lever and with smallholder tea growers in the Gudalur valley in the Nilgiris, Tamil Nadu, in June 2004 and April 2005 to identify the problems workers and tea growers faced.

The problems include low wages, hunger and malnutrition, increasing job insecurity, smallholder tea growers struggling to feed their families and displacement of tribal communities from their land by tea plantation owners.

The report says, "Our field research in Tamil Nadu, as well as reports from Assam, West Bengal and Kerala, show that workers in the Indian tea sector have been severely affected by: abandonment and closure of plantations, wage cuts and delays in wage payments, worsening living conditions, increasing job insecurity and casualisation, loss of welfare benefits, such as sanitation, healthcare and education, and rise in malnutrition and starvation.

"Many factors have been cited as causing the recent crisis in the Indian tea sector. These include the sharp drop in producer prices since the late 1990s, lack of investment in and mismanagement of plantation estates, and rising labour costs."

The reports goes on to say, "Analysts agree that fall in prices is one of the most significant causes of the crisis, and suggest that prices are being driven down by oversupply of tea on the Indian market generated by: decline in demand on global tea markets; increasing productivity on plantations, expansion of plantations in northeast India, and decrease in demand for low-quality tea from tea companies."

Fifty-five per cent of Indian tea is sold through auction houses, with the rest sold through private sales. Since 1998, auction prices for tea have fallen by 33 per cent.

The report adds that at least 19 plantations in Kerala, over 30 plantations in West Bengal, about 70 plantations in Assam and three or more plantations in Tamil Nadu have closed down since the late 1990s.

"It is estimated that more than 60,000 workers have lost their jobs since 2002 and the livelihood of tens of thousands more are threatened."

Responding to a request by Business Line for comments on the report, a spokesperson of Hindustan Lever said, "The report essentially repeats allegations first made by ActionAid in January this year. These have been investigated and found to be baseless. Unilever recently had a productive meeting with ActionAid UK at which this had been shared. All recognised that the issues facing the tea industry are diverse and complex and involve a large number of parties."

"The Indian tea industry is highly regulated and unionised; wage levels and conditions of employment are set across the board. We pay industry-wide agreed wage which is in line with the industry.

"HLL has an impeccable record of paying all workmen on time - all dues are paid and records are open to statutory inspections by authorities under the Plantation Labour Act.

"Our workmen are fully represented by unions which are in continuous contact with the management on all such issues.

"As regards health facility, every plantation has its own hospital and, except in case of referral, the workers do not need to go to any other hospitals. Our permanent and seasonal workers and their dependents are provided free medical services.

"Apart from this, crèche facility and meals are also available for children below six years of age on a daily basis. Maternity benefit too is extended to our workers.

"We would like to assure you that we firmly believe in sustainable agriculture and we would source tea only from those plantations that behave ethically."

ActionAid is now calling on the UK Government to introduce laws to ensure that directors of UK-listed companies have a legal `duty of care' to fully respect the rights and livelihood of the communities they work with and that they consider the impact of their business on all stakeholders, such as workers and smallholder farmers, alongside their financial commitments to shareholders.

The UK is the third largest importer of Indian tea in the world. Fourteen per cent of tea imported into the UK each year comes from India, at a value of £20 million.

The leading UK tea brands are PG Tips and Tetley, owned by Unilever and Tata Tea respectively, both of which have significant operations in India.

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